Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX).
Under what broad classification of liabilities would environmental liabilities generally fall? Why?
Environmental Remediation Liability Under ASC 410-30
An entity operates a nuclear power plant at which the occurrence of a catastrophic accident results in the contamination of land surrounding the site. Under local and federal laws, the entity is required to remediate the radioactive materials. Because the obligation to remediate the land around the site results from a catastrophic event (i.e., improper operation of the asset), the obligation should be accounted for under the ASC 450-20/ASC 410-30 probability model.
05-5 The first kind of environmental law, environmental remediation liability laws, includes individual statutes as well as response provisions in other statutes. The most important of these are the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and the Reauthorization Act of 1986, which together are referred to as Superfund, and the corrective action provisions of the Resource Conservation and Recovery Act of 1976. . . . 05-8 Environmental laws of the second kind are intended to control or prevent pollution and are directed at identifying or regulating pollution sources or reducing emissions or discharges of pollutants. There are many statutes that regulate sources of pollution, including the pollution control provisions of the Resource Conservation and Recovery Act of 1976 (solid and hazardous wastes), the Clean Water Act (discharge of pollutants into the waters of the United States and to publicly owned treatment works), and the Clean Air Act (emission of pollutants into the atmosphere). Other examples are the Emergency Planning and Community Right-to-Know Act and the Pollution Prevention Act of 1990.
The following are some of the main federal regulations that serve as drivers of environmental liabilities:•
The Clean Air Act of 1970 (CAA).
• The Clean Water Act of 1972 (CWA).
• The Toxic Substances Control Act of 1976 (TSCA).
• The Resource Conservation and Recovery Act of 1976 (RCRA).
2.1.1 The Clean Air Act
The CAA regulates air emissions from both stationary and mobile sources. For example, the law authorizes the EPA to set the National Ambient Air Quality Standards, which protect health and public welfare and regulate emissions of hazardous air pollutants. Congress established much of the basic structure of the CAA in 1970 and made major revisions to the law in 1977 and 1990. The changes were designed to improve the effectiveness of the CAA and target newly recognized air pollution problems such as acid rain and damage to the stratospheric ozone layer. For example, the 1990 CAA Amendments introduced new requirements, including the following:• Air pollution sources must obtain an operating permit issued under a federally approved state program that satisfies the requirements of the CAA.• Mandates related to the control or reduction of 189 toxic air pollutants emitted by:o Major sources emitting 10 tons per year of any one, or 25 tons per year of any combination, of those pollutants.o Area sources (i.e., smaller sources such as dry cleaners).• The establishment of a Chemical Safety Board to investigate accidental releases of chemicals.For some air pollution problems (e.g., acid rain, ozone layer protection, vehicle emissions, and certain stationary source programs involving common pollutants), the CAA Amendments encourage the use of market-based principles, such as performance-based standards and emissions banking and trading.For example, in allowance trading, affected sources such as utilities are required to install systems that continuously monitor emissions of sulfur dioxide (SO2), nitrogen oxides (NOx), and other related pollutants to track progress and ensure compliance. Entities that reduce their emissions below their held number of allowances may (1) trade allowances with other entities in their system, (2) sell them to other entities on the open market or through EPA auctions, or (3) bank them to cover emissions in future years.
2.1.2 The Clean Water Act
The Federal Water Pollution Control Act of 1948 was the first major U.S. law to address water pollution. In 1972, the law was amended and became known as the CWA. The CWA regulates discharges of pollutants into U.S. waters and sets quality standards for surface waters. Under the CWA, it is unlawful for an entity to discharge any pollutant from a point source (i.e., a discrete conveyance such as a pipe or man-made ditch) into navigable waters without a National Pollutant Discharge Elimination System (NPDES) program permit.8Deloitte | A Roadmap to Accounting for Environmental Obligations and Asset Retirement Obligations (2019)
2.1.3 The Toxic Substances Control Act
The TSCA grants the EPA the authority to mandate reporting, recordkeeping and testing requirements, and restrictions related to chemical substances, mixtures, or both. Chemicals regulated under the TSCA include polychlorinated biphenyls (PCBs), asbestos, radon, and lead-based paint. In 2016, Congress enacted the Frank R. Lautenberg Chemical Safety for the 21st Century Act, which amended the TSCA. The 2016 amendments to the TSCA include the following: • A mandatory requirement for the EPA to evaluate existing chemicals with clear and enforceable deadlines.• A new risk-based safety standard.• Increased public transparency for chemical information.
2.1.4 The Resource Conservation and Recovery Act
Under RCRA, the EPA is authorized to control hazardous waste “from cradle to grave,” which includes the generation, transportation, treatment, storage, and disposal of hazardous waste. In addition, RCRA provides a framework for the management of nonhazardous waste. Since its enactment in 1976, RCRA has been amended twice. In 1984, the Federal Hazardous and Solid Waste Amendments (HSWA) revised RCRA to focus on waste minimization, phasing out land disposal of hazardous waste, and corrective action for releases. The 1986 amendments to RCRA enabled the EPA to address environmental problems that could result from storing petroleum and other hazardous substances in underground tanks.RCRA encompasses several different program areas to ensure compliance with statutes and regulations in the management of hazardous waste and underground storage tanks. For example, Subtitle D of RCRA pertains to nonhazardous solid waste requirements. Regulations established under Subtitle D ban open dumping of waste and set minimum federal criteria for the operation of municipal waste and industrial waste landfills, including design criteria, location restrictions, financial assurance, corrective action (or cleanup), and closure and postclosure requirements. States assume a lead role in implementing these regulations and may set more stringent requirements than those in Subtitle D. In the absence of an approved state program, the federal requirements apply. Subtitle C of RCRA pertains to the regulation of hazardous waste. Under Subtitle C, the EPA may authorize states (in lieu of the federal government) to implement key provisions of hazardous waste requirements. If a state program does not exist, the EPA implements the hazardous waste requirements in that state. Subtitle C regulations set criteria for (1) hazardous waste generators, (2) transporters, and (3) treatment, storage, and disposal facilities. The criteria include permit requirements, enforcement, and corrective action or cleanup.
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the...
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). What costs are generally included in the liability?
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). What factors should firms consider in the estimation of environmental remediation liabilities?
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). Are the rules governing the accrual of environmental remediation liabilities general the same as other contingent liabilities?
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). Briefly explain the following terms: Environmental remediation liability Superfund Potential responsible parties
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). Question: Comment on the application of Generally Accepted Accounting principles and if you think there has been an ethical breach in this circumstance.
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). What if there are uncertainties about the share of the obligation the entity will bear?
Environmental remediation costs have become increasingly prevalent in the past few decades. Conduct research in the Accounting Standards Codification to address the following requirements. Also, please be sure to provide a citation to the appropriate codification section (using the full paragraph number, i.e. ASC XXX-XX-XX). What does an entity do if it can only estimate some of the components of the liability?
First, read the article on "The Delphi Method for Graduate Research." ------ Article is posted below Include each of the following in your answer (if applicable – explain in a paragraph) Research problem: what do you want to solve using Delphi? Sample: who will participate and why? (answer in 5 -10 sentences) Round one questionnaire: include 5 hypothetical questions you would like to ask Discuss: what are possible outcomes of the findings from your study? Hint: this is the conclusion....